Retail investors may have been the first ones to get involved with cryptocurrencies, but now it’s institutional investors running the show.
Last year, institutions traded $1.14 trillion of cryptocurrencies on Coinbase Global (COIN) , the biggest U.S. digital-currency exchange, more than double the $535 billion total for retail players, The Wall Street Journal reports. The institutional total surged almost 10 times from $120 billion in 2020.
“It’s a completely different game now than it was,” Leah Wald, chief executive of Valkyrie Funds, which sells cryptocurrency exchange-traded funds, told the paper.
Potential Positive for Digital-Currency Future
Early crypto adopters may rue the fact that institutional investors have taken over the market. But that’s probably a good thing for the future of digital currencies. It gives them a stamp of legitimacy, increases trading volume and can bring more stability to a volatile market.
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BlackRock (BLK) – Get BlackRock, Inc. Report, the world’s largest asset manager with more than $10 trillion as of Dec. 31, is exploring how best to help clients interested in the crypto sphere, sources told TheStreet on Thursday.
One of the avenues that BlackRock Chief Executive Larry Fink’s firm is exploring is how to enable its clients to trade on its internal Aladdin platform, the sources said.
Aladdin is BlackRock’s platform for managing investments and financial operations. It’s used by institutional investors, including asset managers, pension funds, insurers and corporate treasurers.
To be sure, BlackRock hasn’t made a decision yet and may not go so deep into crypto.
Among companies with substantial stakes in bitcoin, the largest digital currency, are electric-vehicle titan Tesla (TSLA) – Get Tesla Inc Report, business-intelligence-software company MicroStrategy (MSTR) – Get MicroStrategy Incorporated Class A Report and financial services stalwart Block (SQ) – Get Block Inc Class A Report. MicroStrategy is now arguably more of a bitcoin company than a software provider.